OTTAWA - Millions of Canadians living in big swaths of the country could find their homes declared uninsurable as the insurance industry grapples with skyrocketing water damage claims.

That's the grim future predicted by University of Waterloo environmental professor Blair Feltmate.

Feltmate is chair of the Climate Change Adaptability Project, funded jointly by the university and Intact Insurance, the country's largest property and casualty insurer.

Feltmate says extreme weather events have become so common that insurance companies are now losing money on water damage insurance — even though it only covers water that backs up into basements.

Feltmate says he believes the industry will succumb to pressure to extend coverage to include damage caused by so-called overland flooding, when water pours into homes through doors and windows.

But to keep it affordable, he predicts insurers will have to refuse to insure homes in exceptionally high-risk areas and agree to insure other vulnerable areas only on condition that municipalities "weather-harden" their infrastructure to withstand floods.